Friday, July 31, 2009

Teamwork and Trading Success

When producer Danger Mouse (right above) and rapper/vocalist Cee-Lo Green (left) created the Gnarls Barkley collaboration, the result was music that was qualitatively different than either artist had achieved previously. That music, nominated for four Grammy awards, is most familiar to the public via the song "Crazy". Perhaps even more creative is Chris Milk's video for their song "Who's Gonna Save My Soul?" The combination of the collaborative music and the collaboration with the video producer created quite a novel piece of work.

I've seen this with traders as well. Individually the traders achieve modest results, but teamed together, the whole becomes more than the sum of the parts. This is common at investment banks and hedge funds: getting the right people "on the desk" is a huge part of success. The right team inspires each other, informs each other, and brings the best out in each other.

When you're part of a team, you become accountable to your teammates. Suddenly that makes discipline a greater imperative. Many times we won't let others down, where we might cut corners on our own.

As in a marriage, we become greater when we find the right partners.



Gustavo's Trades said...


I tried trading without my team earlier this week, I was experimenting with a different time frame and we don't meet at that time.

It was horrible! The sum of the parts is what makes the difference. Like you said, accountability and sharing information is essential. No doubt about it!


Matt Fahmie said...

I absolutely agree with you. One is being held responsible for their actions when surrounded by a team. This in itself forces one to become more discipline and focused in their trading. To follow ones game plan, and execute accordingly, or be held accountable for your failure. I also always used everyone around me, on any team sport I've played, as a catalyst to be the best out of all of them; thus further enhancing my progression. As I have read,this is one of the main reasons why traders who trade from their own homes are not as successful as traders who trade with other like minded individuals at professional trading firms. Among a slew of other advantages like technological infrastructure, trained specialists that review and refine the trader, the support of others with like minded goals, commission rates, and risk managers who monitor trader's risk and performance, it only seems logical these traders at firms posses a gigantic edge over individual traders not in a prop firm. This is why I must find my way into one.

stephens said...

Dr. Brett;

I agree with the team concept and certainly see the value in a collaborative effort.

In my experience finding that group has been challenging. I've been trading for just under 10 years on my own and would be interested in forming or becoming part of a collaborative effort to share ideas and experiences.

While this is in no way a new idea, achieving the goal of mutual information sharing has proven to be elusive.

Many of the for fee services/chat rooms/mentor programs are extremely one sided. I’m not looking for market “calls” but rather seek the equal exchange of market ideas.

Do you have any ideas or suggestions?